Reduce the employee’s share of premiumYou could choose to pay for a higher percentage of the premium, which would reduce their monthly contributions. If that’s not feasible, one tactic that can end up saving you and your employees money is offering to either pay a certain portion of the premium if they choose a silver plan, or pay for the entire premium for employees who choose bronze plans. The trade-off for the workers who choose the latter option is having no premiums, but more out-of-pocket expenses when they use health care services. But if you are thinking about taking this route, please discuss it with us first as it’s best to crunch the numbers to see how cost-effective it would be for you. The majority of workers contribute a portion of the premium for their coverage. According to the Kaiser Family Foundation “2020 Employer Health Benefits Survey”:
- The average U.S. worker contributes 17% of the group health plan premium for single coverage, and 27% of the premium for family coverage.
- Workers in small firms contribute on average 35% for family coverage.
- Workers in large firms contribute on average 24% for family coverage.
- Workers in both small and large firms contribute on average 17% for single coverage.
Offer different types of plansThis can be a win-win for everyone. Younger, healthy employees that do not use health care services often can opt for an HDHP, which features a lower up-front premium in return for the participant having to spend more out of pocket for services they access. But if someone doesn’t use medical services often, this type of plan may the right and most cost-effective option. On the other hand, for older workers or those who see the doctor more often or have health issues, they may be more inclined to go with a preferred provider organization (PPO) to pay more for a higher premium in exchange for lower out-of-pocket costs over the year. For the fifth year in a row, the percentage of companies that offer high-deductible plans as the sole option will decline in 2021, according to a survey of large employers by the National Business Group on Health. That may be a continuation of a trend, but the pandemic has also put an emphasis on improved employee benefits. Here’s a breakdown of the kinds of small group plans across the country in 2020, according to Kaiser:
- PPOs covered 47% of workers.
- HDHPs covered 31%.
- Health maintenance organizations (HMOs) covered 13%.
- Point-of-sale plans covered 8%.
- Conventional (indemnity) plans covered 1%.